"Is it legal to buy and sell used software?"

Most software developers permit users to transfer their software licenses, as long as it is done in accordance with the terms and conditions laid out in the developers' End-User License Agreement (EULA). Below are a few examples:

Adobe®
"Transfer. You may...transfer all your rights to Use the Software to another person or legal entity provided that: (a) you also transfer (i) this Agreement, (ii) the serial number(s), Software and all other software or hardware bundled, packaged or pre-installed with the Software, including all copies, Updates and prior versions, and (iii) all copies of font software converted into other formats, to such person or entity; (b) you retain no copies, including backups and copies stored on a computer; and (c) the receiving party accepts the terms and conditions of this Agreement and any other terms and conditions upon which you legally purchased a license to the Software."

(Source: Adobe Photoshop 7.0)

Borland®/Inprise®
"You may transfer the Software and documentation on a permanent basis provided you retain no copies and the recipient agrees to the terms of the License Agreement...If you have purchased an upgrade version of the Software, it constitutes a single product with the Inprise software that you upgraded. You may use or transfer the upgrade version of the Software only in accordance with the License Agreement."
(Source: Borland JBuilder 4.0 Enterprise)

Corel®

"You may...transfer the Product to someone else only if you assign all of your rights under this License, cease all use of the Product, erase or destroy any copy (including the hard disk copy) made in support of your use of the Product, and ensure that the person to whom you wish to transfer the Product agrees to the terms of this License."

(Source: CorelDRAW Graphics Suite 11)

Macromedia®
"...you may permanently transfer all of your rights under this EULA only as part of a sale or transfer, provided you retain no copies, you transfer all of the Software (including all component parts, the media and printed materials, any upgrades, this EULA, the serial numbers, and, if applicable, all other software products provided together with the Software), and the recipient agrees to the terms of this EULA. If the Software is an upgrade, any transfer must include all prior versions of the Software from which you are upgrading. If the copy of the Software is licensed as part of the whole Studio...the Software shall be transferred only with and as part of the sale or transfer of the whole Studio, and not separately. You may retain no copies of the Software."
(Source: Macromedia Studio MX 2004)

Microsoft®
"Software Transfer. Except as specified in this Section, the initial licensee of the Software Product may make a one-time permanent transfer of this EULA and Software Product only directly to an end user. This transfer must include all of the Software Product (including all component parts, the media and printed materials, any upgrades, this EULA, and, if applicable, the Certificate of Authenticity). Such transfer may not be by way of consignment or any other indirect transfer."
(Source: Microsoft Office XP Professional)

Symantec®
"You may...after written notice to Symantec, transfer the Software on a permanent basis to another person or entity, provided that you retain no copies of the Software and the transferee agrees to the terms of this license."
(Source: Symantec pcAnywhere 11.0)

Important:
The above EULA excerpts are compiled for your reference only. Each excerpt must not and should not be perceived in general that (i) license transfer is supported and/or endorsed; (ii) transfer is offered condition-free, or (iii) it applies to all products manufactured; by the software developer concerned. Further, such information may change over time. For a complete and up-to-date version of the EULA published, we strongly advise readers to contact the respective software developers.

Software Exchange, its employees, board of directors, makes no warranty, express or
implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product or process disclosed. In no event
shall Software Exchange or other third parties mentioned at this site be liable for any claims whatsoever arising out of the use and inability to use, of this site.

Adobe®, Borland®, Corel®, Inprise®, Macromedia®, Microsoft® and Symantec® are registered trademarks of their respective manufacturer(s).